Witnesses said that protestors marching past the building ignored the bank employees’ cries for help and that a handful even shouted anti-capitalist slogans. [ … ] It took a statement from President Karolos Papoulias to best sum up Greece’s dire situation and the frustration that many people are feeling with the political system. “Our country has reached the edge of the abyss,” he said. “It is everybody’s responsibility that we do not take the step toward the drop. Responsibility is proved in action, not in words. History will judge us all.”

Now we have an intelligentsia that is hooked on patron-client exchanges and mediocrity, and a political establishment whose biggest concern is keeping its piece of the pie safe. On the flipside of the same coin we have a culture of protest in which anything goes and which tries to justify every “accident,” like yesterday’s murder of three working people by a hooligan who flipped them the finger when he saw them choking on the smoke of his firebomb. Now that we have succeeded in running the country into the ground, it is time to either rise to the occasion or kneel to the developments. The deal with the IMF and the EU will bring a lot of pain to a lot of people who are not to blame for the situation. We can’t throw money at the problem because we have none.

The chief beneficiaries of the welfare state ethos are the organized interests on whose behalf most government interference with the economy is undertaken. These interests receive the lion’s share of the subsidies which, drawn from general tax revenues or imposed by government-enforced restriction of competition, are our major means for redistributing wealth. As a result, the net effect of government manipulation of the economy is negative for the poor. That is, one clear result of the expansive activism of our expanded government is a lower living stand for the poor.

It would be nice if socialists learned something from the Greek tragedy, but they won’t. They should learn that socialism causes social unrest as people fight like dogs over the few remaining bones of wealth left. But they will keep preaching that capitalism causes inequality of incomes that lead to social unrest.

Granted, some amid the crowds venting fury about the terms of the bailout were anarchists who sought to sow chaos and violent disruption for its own sake. The majority were not. Many in the huge crowds were those who felt that they had been cheated by the rich. The air was thick with a sense of injustice. And as three charred bodies were pulled from a bank that had been torched, the spectre of something altogether more sinister than just the usual run of riots hovered over Greece – class war.

It is to be hoped that the deaths have some positive legacy. They have shocked many. Even anarchists happy to dispatch a bank branch with a Molotov cocktail will pause at the prospect of body bags.

But as the demonstrators chanted “Thieves, thieves” on Wednesday, there will have been many in Greek society who know that the cry is addressed to them: industrialists; politicians; even parts of the Orthodox Church that plays such a huge part in Greek life – all stand accused of milking the rest of society.

In the worst-case scenario, it may be payback time. Poor against rich. Masses against elite. There are plenty who feel they have little, on earnings of just a few hundred euros a month, to lose.

U.S. taxpayers on the hook, once again, says Sen. Jim DeMint (HT: Powerline):

Right now, 17 percent of the IMF funding pool that the $40 billion bailout is being drawn from comes from U.S. taxpayers. If that ratio holds true, that means American taxpayers are paying for $6.8 billion of the Greek bailout. Although the $108 billion extra that Congress approved for the IMF in 2009 hasn’t yet gone into effect, you can bet that once it does Greek bankers will come to the IMF again with their hat in hand. And, if other European Union countries see free money up for grabs they could ask the IMF for bailouts when they get into trouble, too. If we’ve learned anything from the Wall Street bailouts it’s that just one bailout is never enough.

Frank Christiano

What’s going to happen in the US when the social security and medicare systems run out of money? Do you think there will be unrest in the US? I do.

The welfare state’s death spiral is this: Almost anything governments might do with their budgets threatens to make matters worse by slowing the economy or triggering a recession. By allowing deficits to balloon, they risk a financial crisis as investors one day — no one knows when — doubt governments’ ability to service their debts and, as with Greece, refuse to lend except at exorbitant rates. Cutting welfare benefits or raising taxes all would, at least temporarily, weaken the economy. Perversely, that would make paying the remaining benefits harder.

Greece illustrates the bind. To gain loans from other European countries and the International Monetary Fund, it embraced budget austerity. Average pension benefits will be cut 11 percent; wages for government workers will be cut 14 percent; the basic rate for the value-added tax will rise from 21 percent to 23 percent. These measures will plunge Greece into a deep recession. In 2009, unemployment was about 9 percent; some economists expect it to peak near 19 percent.

If only a few countries faced these problems, the solution would be easy. Unlucky countries would trim budgets and resume growth by exporting to healthier nations. But developed countries represent about half the world economy; most have overcommitted welfare states. They might defuse the dangers by gradually trimming future benefits in a way that reassures financial markets. In practice, they haven’t done that; indeed, President Obama’s health program expands benefits. What happens if all these countries are thrust into Greece’s situation? One answer — another worldwide economic collapse — explains why dawdling is so risky.

From the Telegraph — Greek tragedy: how last phone call by murdered bank clerk touched off backlash

Her mother, Panayota, never did get another phone call. Instead, her 32-year-old daughter, who was four months pregnant, died along with two other colleagues on Wednesday after the demonstrators hurled firebombs through the broken windows, asphyxiating all three in clouds of toxic smoke. Angeliki’s last words, which were disclosed by her grieving mother yesterday, provide the final poignant, postscript to how a week of mounting frustration over the country’s debt crisis spiralled tragically out of control.

… the deep-seated problems remain. Three stand out: first, the weight of the welfare state and aging populations; second, the burden of huge private debts (mortgages and consumer loans in America and elsewhere); and finally, huge imbalances in global trade, with some countries — notably China — running massive surpluses and others — notably the United States — having large deficits. Each threatens a vigorous recovery that could conceivably plunge the world back into a protracted slump.

Neal Lang

“What’s going to happen in the US when the social security and medicare systems run out of money? Do you think there will be unrest in the US? I do.”

Maybe they can get AIG to underwrite these policies. After all, they were sold to “working Americans” as insurance policies!